Groupe Michelin reported net income of 772 million euros on sales of 16.8 billion euros for its fiscal 2007 ended Dec. 31, 2007. That compares to net income of 573 million euros on sales of 16.4 billion euros for 2006.
Based on the annual average exchange rate, Michelin posted net income of $970 million on sales of $21.2 billion.
Year to year, Michelin improved its net income by 34.7%, and its sales by 2.9%. As a percentage of sales, the company's net income increased from 3.5% in 2006 to 4.5% in 2007.
"In 2006, for the fourth year in a row, Michelin had to cope with continued external cost inflation: raw materials, energy and logistics in particular," says Managing Partner Michel Rollier.
"The Groupe's pricing policy made it possible to preserve a high level of operating income, a level that we intend to raise further in the future. To this end, it is more necessary than ever to bring the Groupe's entire cost structure down and to push sales volume growth through increasingly competitive product offerings.
"In 2007, markets are globally expected to grow while external costs should show more favorable trends than in the past. Michelin's net sales and operating margin should, therefore, post a tangible increase compared to 2006, in line with the objectives the Groupe has set for 2010."
In North America, Michelin recorded sales of $8.1 billion, up 4.5% compared to 2006.
"We have more work to do to cut costs and improve our productivity so that we can continue to compete against the flood of rising tire imports, increased raw material and health care costs," says Jim Micali, chairman and president of Michelin North America Inc.
